In a world grappling with pressing challenges such as climate change, social inequality, and environmental degradation, an increasing awareness is taking hold regarding the need for Multinational Corporations (MNCs) to embark on the path of sustainable development.

In the face of every big crisis, whether economic, social, or environmental, the tendency is to point the finger at the business world. Critics often blame the greed of a capitalistic world made of enterprises that are frequently regarded as succeeding at the expense of the community.

What they often disregard is the possibility that businesses may play a significant role in unleashing an extraordinary wave of innovation and growth. Re-legitimising business and making it an engine of social progress was the inspiration for me to deepen this topic and put it at the heart of the research study that I recently published.

What lies at the core of this is the concept of Creating Shared Value (CSV) which is all about recognising and strengthening the link between economic and social success. In this context, doing good and doing well are not mutually exclusive.

A sustainable profit is not only morally preferable but, above all, long-lasting. In our current, unstable, environment, there is no other way but to pursue a success that can endure over time.

So, what is the role of MNCs in promoting sustainable development and why should it be pursued?

The United Nations (UN) Sustainable Development Goals (SDGs), adopted by all 193 UN member states in 2015, present an ambitious blueprint for addressing global issues. The 2030 Agenda is not just a call to action for governments and civil societies, but also a compelling invitation for businesses, especially MNCs, to lead the charge towards a more equitable and sustainable future.

In this sense, MNCs may play a crucial role in the global economy, and their involvement in sustainable development is instrumental for achieving the UN SDGs. With their capabilities in innovation, global reach, and financial strength, MNCs are well-positioned to make significant contributions to these goals.

The pursuit of SGDs will not only be beneficial to the welfare of society, but will also simultaneously deliver a range of benefits to companies, including, but not limited to: identifying future business opportunities and meeting the needs of the large market left unexplored in terms of both products and services; enhancing corporate sustainability by more efficiently using resources and finding more sustainable alternatives; maintaining track on political changes and establishing ties with stakeholders at international, national, and regional levels.

However, these opportunities will not be realised if we remain on the so-called “business as usual” approach, focused on managerial calculations related to costs, yields and competitiveness estimates. We need to go beyond the mere economic and financial aspects and see companies as “development agents”, strengthening their commitment to integrate SDGs into their business goals. This call for radical change has fostered the idea of sustainability being integrated into the core strategy of businesses.

What does it mean to integrate sustainability into the core of a business?

At the crossroads of many perspectives about sustainability, social enterprise, and corporate citizenship, a business idea emerged as a new approach capable of reconnecting business with society in accordance with the 2030 Agenda for Sustainable Development. This concept, titled ‘Creating Shared Value’ (CSV), was pioneered by Porter and Kramer (2011).

Moving beyond the traditional confines of corporate social responsibility, CSV focuses on creating economic value in a way that also creates value for society by addressing its challenges.

The main idea of CSV is to integrate societal problems into capitalistic mechanisms so that businesses and society both benefit from each other simultaneously. In this view, the Shared Value model is likely to be a valid enabler of the SDGs’ aim of addressing global social concerns.

So, how can CSV be embraced by MNCs as a business strategy to drive the achievement of SDGs?

Despite the growing interest in CSV as a business strategy for MNCs to support SDGs in developing markets, there remains a scarcity of empirical research on the practical implementation of CSV strategies.

To tackle this research gap, I presented my findings through three main streams that illustrate the driving forces for embedding CSV at the core of any business by following the transformation journey of an Italian energy company as a case study.

• Leadership-driven transformation

A key success factor is the commitment of business leaders who initiate and drive strategic changes focused on creating value for all stakeholders. Indeed, for our case study, the strategic leadership of the CEO was crucial in steering the company towards a sustainable future by means of an organisational culture that intends to pursue meaningful transformation throughout the entire business ecosystem.

Some initiatives implemented by the company exemplified the profound impact that a sustainability-focused organisational culture can have on both the business and the local communities it serves. These projects were not just isolated efforts but were reflective of a deep organisational commitment to sustainability, permeating within every level of the company.

• Strategic alignment and implementation

The findings highlight that the company’s choice to embrace a CSV strategy stemmed from a broader vision, one that encompasses addressing both social and environmental challenges while aiming to meet SDGs. Their dedication transcends mere business objectives, showcasing their profound commitment to understanding and fulfiling the intrinsic social needs of communities, using the CSV strategy as a vehicle. This not only broadens their business scope but ensures a more intricate, mutually beneficial engagement with all entities they interact with.

An illustrative example is the company’s approach when inaugurating an energy plant in Colombia. They consider not only the immediate impact on the local community but also the broader implications of their activities, such as the sourcing of materials from diverse locations. This comprehensive approach to sustainability underscores the company’s commitment to SDGs, coupled with an ambition to democratise the advantages of a globally integrated economy.

• Local stakeholder integration

Finally, multiple stakeholders, including government agencies, NGOs, communities, financial institutions, and other businesses, must be involved so as to leverage their local knowledge to build mutual trust and deliver local responsiveness.

For instance, in Chile, the energy security program saw the company working alongside two NGOs and a local municipality in the capital city, Santiago. These stakeholders provided on-the-ground knowledge and logistical support, ensuring that the programme was not only well-received but also effectively addressed the unique challenges faced by the local community.

CSV strategies are built on strong collaboration with communities to better understand their needs, with the aim of building a collaborative ecosystem made of private-public partnerships, making them a significant enabler of local development.

How can we use these results to help build a “solution economy”?

My study highlights the unique position of MNCs in promoting sustainable development. By adopting CSV strategies, these corporations move away from traditional business models and innovate towards new, sustainable business practices. This involves integrating sustainability principles into their value capture mechanisms.

By doing so, I aimed to provide a few insights from which entrepreneurs and businesspeople may draw inspiration to rediscover a new way of doing business and rethink capitalism.

Companies operate within larger systems, and pursuing adversarial objectives is something that does not benefit any of the parts involved. The business world is not just a source of labour or a provider of products and services, but a fundamental engine for innovation and economic development.

The opportunity of generating economic value through the creation of social value will be the major force driving the future of the global economy.